New OE
The old OE method is not used because of a lack of access to the reverse.
Trying to write this as a problem statements
1) Mesh connecting. 1000's of servers in a cloud. They need to talk to each other.
2) client-server like solution as TLS, where client authenticates server, but server does not authenticate the client. Does OE using IPsec add enough value compared to TLS, or is this problem now basically solved with TLS added to every protocol (and UDP with TLS, DTLS). TLS does not hide what kind of communication you use (eg bittorrent, SIP)
What is new these days is that we believe everyone needs to run a local validator resolver for DNSSEC. That gives us an option to hook into there. When an application does an A record lookup, before the DNS server returns that, lookup IPSECKEY, and if there, establish an IPsec tunnel. Then release the A record to the application. This works for resources accessed via DNS, but not resources accessed via IP. But we believe that with IPv6, it will become more and more common to use FQDN.
A second method could be to use TLS and get a FQDN based on IP address from the cert.
There are two different methods we can support for establishing IPsec connections 1) initiator only like. This is the TLS model, where the there is a client-server model. The client does not have to get authenticated by the server. Only the client needs to authenticate the server. 2) As Hugh Daniel rightfully would say, there are no client-servers, only equal peers. They must both authenticate each other. While 2) is better, 1) can be done without requiring a client configuration.
Also think about "dnssec chains" to get keys, perhaps using IKE itself?
Regardless, it seems everyone agrees that the reverse will never be used, and pluto should not do the work for finding if it can or cannot do IPsec to an endpoint. It should be a model into the DNS server (eg unbound) or into the ActiveDriectory server (eg sssd module)
Remove it, but not first thing now. Let's think and see where it is going.